A company in Louisville that develops and makes surgical and nonsurgical devices used by cosmetic surgeons has signed a definitive acquisition agreement with a California company.
Privately-held Sound Surgical Technologies LLC will be acquired by Solta Medical Inc. (NASDAQ: SLTM), for $25.5 million in Solta common stock and $5 million cash. The deal is expected to close before the end of the first quarter of 2013.
In addition to the payments due at closing, Sound Surgical unit holders are entitled to receive up to $9.5 million of contingent payments that would be paid in Solta common stock based on revenue from Sound Surgical products this year, according to a company press release.
Sound Surgical's unaudited revenue for the year ended Dec. 31 rose over 40 percent from 2011 to approximately $23 million. The company was founded in 1998 and its VASER Lipo system uses ultrasound waves to selectively emulsify fatty tissue prior to extraction from the body. By emulsifying targeted fat cells, VASER technology allows physicians to perform fat extraction with less tearing of the surrounding tissues, thus reducing blood loss, pain and bruising.
"Sound Surgical provides Solta with a complementary, diversified product portfolio targeting the over $500 million body contouring market segment and the transaction meets our key acquisition criteria," said Stephen J. Fanning, chairman, president and CEO of Solta. "In combination with our rapidly growing Liposonix product line, the acquisition presents significant cross-selling opportunities to plastic surgeons and dermatologists, as well as expanded international sales potential."
David Holthe, manager and chairman of Sound Surgical, will join Solta's board of directors.
"Solta has demonstrated a unique ability within our industry to build brands, create cross-selling opportunities and foster international adoption," said Daniel S. Goldberger , CEO of Sound Surgical. "We believe that by combining our sales organization with Solta's, we will enhance market penetration of our highly differentiated technologies with plastic surgeons and dermatologists. Our team looks forward to becoming part of Solta Medical."
Goldberger will serve as a consultant for six months to help with the transition.
Solta Medical's revenue for the fourth quarter was roughly $40 million. Revenue for the 12 months that ended Dec. 31 was a little more than $144 million.